The Economic Way of Thinking- CH. 1 Economics

___________exists when there are not enough resources to satisfy human wants.

• Factors of Production

• Scarcity

• Economics

• Need

the study of how people try to satisfy what appears to be seemingly unlimited and competing wants through the careful use of relatively scarce resources

• Positive Economics

• Normative Economics

• Economics

• Factors of Production

a basic requirement for survival (food, clothing, shelter)

• Want

• Need

• scarcity

• incentive

desires that can be satisfied by consuming a good or a service.

• Want

• Need

• Incentive

• Scarcity

_________ are the resources needed to produce goods and services.

• Opportunity cost

• Supply/Demand

• Scarcity

• Factors of Production

"gifts of nature"; natural resources not created by humans

• Land

• Labor

• Capital

• Entrepreneur

people with all their efforts, abilities, and skills

• Land

• Labor

• Capital

• Entrepreneur

involves the vision, skills, and risk-taking needed to create and run businesses.

• land

• labor

• capital

• entrepreneur

a person who makes goods or provides services

• incentive

• labor

• producer

• scarcity

are objects, such as food, clothing, and furniture, that can be bought.

• Good

• Want

• Need

• utility